<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                               ------------------

                                   FORM 10-KSB

[X]             ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

                   FOR THE FISCAL YEAR ENDED DECEMBER 31, 1998

                                       OR

[ ]           TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

                         COMMISSION FILE NUMBER 0-19040

                     SOUTH FLORIDA BANK HOLDING CORPORATION
             (Exact name of registrant as specified in its charter)

                 FLORIDA                                65-0221393
        (State or other jurisdiction                 (I.R.S. Employer
      of incorporation or organization)              Identification No.)

2017 MCGREGOR BOULEVARD, FORT MYERS, FLORIDA               33901
  (Address of principal executive offices)              (Zip Code)

    Registrant's telephone number, including area code: (941) 334-2020

    Securities registered pursuant to Section 12(b) of the Act: NONE
    Securities registered pursuant to Section 12(g) of the Act:

                     COMMON STOCK, PAR VALUE $0.01 PER SHARE
                                (Title of Class)

         Check whether the issuer has (1) filed all reports required to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12
months (or for such shorter period that the issuer was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days. YES   X     NO
          -----       -----

         Check if disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of issuer's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. [ X ]

         The issuer's revenues for its most recent fiscal year was $7,224,031

         The aggregate market value of the Common Stock held by non-affiliates
of the issuer is $11,287,101, based on the price at which shares of common stock
were sold on August 21, 1998.

         As of March 12, 1999, there were issued and outstanding 1,265,350
shares of the issuer's Common Stock.

                       DOCUMENTS INCORPORATED BY REFERENCE

         1.       Portions of the 1998 Annual Report to Shareholders for the
year ended December 31, 1998 are incorporated into Part II, Items 5 through 8 of
this Annual Report on Form 10-KSB.

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                                TABLE OF CONTENTS

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PART I   .....................................................................1

Item 1.      Business.........................................................1
             General..........................................................1
             Fifth Third Affiliation Agreement................................1
             Deposits.........................................................2
             Loan Portfolio...................................................2
             Investments......................................................3
             Correspondent Banking............................................4
             Data Processing..................................................4
             Effect of Governmental Policies..................................4
             Interest and Usury...............................................4
             Supervision and Regulation.......................................5
             Industry Restructuring..........................................11
             Competition.....................................................11
             Employees.......................................................12
             Statistical Profile and Other Financial Data....................12

Item 2.      Properties......................................................12

Item 3.      Legal Proceedings...............................................12

Item 4.      Submission of Matters to a Vote of Security Holders.............12

PART II  ....................................................................14

Item 5.      Market for the Registrant's Common Equity and
                      Related Stockholder Matters............................14

Item 6.      Management's Discussion and Analysis of Financial
                      Condition and Results of Operations....................14

Item 7.      Financial Statements............................................14

Item 8.      Changes in and Disagreements with Accountants
                      on Accounting and Financial Disclosure.................14

PART III ....................................................................15
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Item 9.       Directors, Executive Officers, Promoters and
                        Control Persons; Compliance with Section 16(a)
                        of the Exchange Act..................................15
              Directors......................................................15
              Executive Officers.............................................17

Section 16(a) Reporting Requirements.........................................18

Item 10.      Executive Compensation.........................................18
              Information About the Board of Directors and Its Committees....18
              Executive Compensation and Benefits............................19
              Information on Benefit Plans and Policies......................19

Item 11.      Security Ownership of Certain Beneficial Owners and 
                        Management...........................................22

Item 12.      Certain Relationships and Related Transactions.................23

Item 13.      Exhibits, Financial Statement Schedules, and Reports on 
                        Form 8-K.............................................23

SIGNATURES...................................................................26

EXHIBIT INDEX................................................................28
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                                     PART I

ITEM 1.           BUSINESS

GENERAL

         South Florida Bank Holding Corporation ("Holding Corporation") is a
one-bank holding company registered under the Bank Holding Company Act of 1956,
as amended ("BHC Act"). The Holding Corporation was incorporated under the laws
of the State of Florida on September 14, 1990. On January 30, 1991, the Holding
Corporation acquired all of the outstanding shares of common stock of South
Florida Bank ("Bank"), following Bank shareholder approval at a special meeting
held on December 19, 1990. As a bank holding company, the Holding Corporation is
a legal entity separate and distinct from the Bank. At December 31, 1998, the
Holding Corporation, its subsidiary Bank, and the Bank's two wholly-owned
subsidiaries, New Town Properties, Inc. and Valu Prop, Inc. (collectively, the
"Company") had consolidated total assets of $90.2 million, total deposits of
$77.0 million, and shareholders' equity of $9.3 million. The Holding Company's
operating revenue and net income are derived solely from the Bank through
dividends and management fees.

         The Bank was organized in 1988 to serve the banking needs of the
residents of the City of Fort Myers and the other surrounding communities. It
began operations on May 23, 1988. The Bank is a Florida state-chartered bank and
its deposits are insured through the Bank Insurance Fund of the Federal Deposit
Insurance Corporation ("FDIC"). The Bank primarily engages in the business of
attracting deposits from the general public and investing those funds in real
estate, commercial and consumer loans. The Bank provides a full range of deposit
accounts and credit services, as well as most other traditional commercial and
consumer banking services, including safe deposit services and automated teller
cards, which allow access to regional ATM networks and permit the Bank's
depositors to access their funds on a 24-hour basis in areas outside the Bank's
geographic market through the Honor System.

FIFTH THIRD AFFILIATION AGREEMENT

         The Holding Corporation entered into an Affiliation Agreement with
Fifth Third Bancorp ("Fifth Third") on October 22, 1998 which provides for the
merger of the Holding Corporation into Fifth Third and the merger of the Bank
into Fifth Third Bank, Florida (the "Merger"). If the Merger is closed, holders
of Holding Corporation Common Stock will be entitled to receive .34800 of a
share of Fifth Third common stock for each share of Holding Corporation Common
Stock presently owned, except to the extent that a shareholder exercises
dissenters' rights. Fifth Third will not issue any fractional shares in the
Merger. Rather, holders of Holding Corporation Common Stock will receive cash
for any fractional share of Fifth Third common stock based on the last trading
price of Fifth Third common stock on the date on which the Merger closes.
Consummation of the Merger is subject to a number of conditions, including the
receipt of prior approval from the bank regulatory agencies and approval of the
Merger by the holders of Holding Corporation Common Stock.


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DEPOSITS

         The Bank's deposit services include business and individual checking
accounts, savings accounts, NOW accounts and certificates of deposit. It is the
Bank's policy to monitor its competition in order to keep the rates paid on its
deposits at a competitive level. Time deposits of $100,000 and over made up
6.72% of the Bank's total deposits at December 31, 1998 as compared to 8.48% at
December 31, 1997. The majority of the deposits of the Bank are generated from
Lee County. The Bank does not accept brokered deposits. At December 31, 1998,
the Bank had $116,000 of public fund deposits, while as of December 31, 1997,
the Bank had 225,000 of public fund deposits. At December 31, 1998 and 1997, no
single depositor accounted for more than 3% of the Bank's total deposits.
Management does not believe the Bank is dependent on a single deposit customer
or group of customers concentrated in a particular industry, whose loss or
insolvency would have a material adverse effect on the Bank's operations.

         Time deposits of $100,000 and over, public fund deposits and funds of
single depositors tend to be short-term in nature and more sensitive to changes
in interest rates than other types of deposits and, therefore, may be a less
stable source of funds. In the event that existing short-term deposits are not
renewed, the resulting loss of the deposited funds could adversely affect the
Bank's liquidity. In a rising interest rate market, such short-term deposits may
prove to be a costly source of funds because their short-term nature facilitates
renewal at increasingly higher interest rates, which may adversely affect the
Company's earnings. However, the converse is true in a falling interest rate
market making such short-term deposits more favorable to the Company.

LOAN PORTFOLIO

         The Bank's loans are concentrated in three major areas: commercial
loans, real estate loans, and installment loans. Approximately 15.21% of the
Bank's total loan portfolio at December 31, 1998, consisted of commercial loans
as compared to 18.69% at December 31, 1997. The majority of the Bank's loans are
made on a secured basis. At December 31, 1998 and 1997, no concentration of
loans within any portfolio category to any group of borrowers engaged in similar
activities or in a similar business exceeded 10% of total loans, except that as
of such date loans collateralized with mortgages on real estate represented
67.60% and 65.32%, respectively, of the loan portfolio and were to borrowers in
varying activities and businesses.

         The Bank's commercial loans include loans to individuals and small- to
medium-sized businesses located primarily in Lee County for working capital,
equipment purchases, and various other business purposes. A majority of the
Bank's commercial loans are secured by inventory, equipment or similar assets,
but these loans may also be made on an unsecured basis. Commercial loans may be
made at variable- or fixed-interest rates; however, it is the Bank's policy that
those loans which will have terms or amortization schedules of longer than one
year will normally carry interest rates which vary with the prime interest
lending rate and will become payable in full and are generally refinanced in
three to five years.


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         The Bank's real estate loans are secured by mortgages and consist
primarily of loans to individuals and businesses for various consumer and
business purposes (whether or not related to the real estate securing them). The
Bank also engages in lending to builders and individuals for the construction of
single-family residences. These real estate loans may be made at fixed- or
variable-interest rates. The Bank generally does not make commercial loans for
terms exceeding 20 years, but does make loans repayable in monthly installments
(based on up to a 20-year amortization schedule) which become payable in full
and are generally refinanced in three to five years. The Bank's residential real
estate loans generally are repayable in monthly installments based on an
amortization schedule of up to 20-years with variable-interest rates; however,
most loans are established with a short-term call provision.

         The Bank's installment loan portfolio consists primarily of loans to
individuals for various consumer purposes, but includes some business purpose
loans which are payable on an installment basis. The majority of these loans are
for terms of less than five years and are secured by liens on various personal
assets of the borrowers, but installment loans may be made on an unsecured
basis. Installment loans are made at fixed- and variable-interest rates, and may
be made based on up to a five-year amortization schedule.

INVESTMENTS

         The Bank invests a portion of its assets in U.S. Treasury and U.S.
Government agency obligations, certificates of deposit, collateralized mortgage
obligations ("CMO's"), and federal funds sold. The Bank's investments are
managed in relation to loan demand and deposit growth, and are generally used to
provide for the investment of excess funds at minimal risks while providing
liquidity to fund increases in loan demand or to offset fluctuations in
deposits.

         With respect to the Bank's investment portfolio, the Bank's total
portfolio may be invested in U.S. Treasury and general obligations of its
agencies because such securities generally represent a minimal investment risk.
Occasionally, the Bank purchases certificates of deposits of national and state
banks. These investments may exceed $100,000 in any one institution (the limit
of FDIC insurance for deposit accounts). CMO's are secured with Federal National
Mortgage Association ("FNMA") mortgage-backed securities and generally have a
shorter life than the stated maturity. Federal funds sold is the excess cash the
Bank has available over and above daily cash needs. This money is invested on an
overnight basis with approved correspondent banks.

         The Bank monitors changes in financial markets. In addition to
investments for its portfolio, the Bank monitors its daily cash position to
ensure that all available funds earn interest at the earliest possible date. A
portion of the investment account is designated as secondary reserves and
invested in liquid securities that can be readily converted to cash with minimum
risk of market loss. These investments usually consist of U.S. Treasury
obligations, U.S. government agencies and federal funds. The remainder of the
investment account may be placed in investment securities of different type and
longer maturity. Daily surplus funds are sold in the federal funds market for
one business day. The Bank attempts to stagger the maturities of its securities
so as to produce a steady cash-flow

                                        3

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in the event the Bank needs cash, or economic conditions change to a more
favorable rate environment.

CORRESPONDENT BANKING

         Correspondent banking involves one bank providing services to another
bank which cannot provide that service for itself from an economic or practical
standpoint. The Bank is required to purchase correspondent services offered by
larger banks, including check collections, check filing, statement rendering,
purchase of Federal funds, security safekeeping, investment services, coin and
currency supplies, overline and liquidity loan participations and sales of loans
to or participation with correspondent banks.

         The Bank sells loan participations to correspondent banks with respect
to loans which exceed the Bank's lending limit. Management of the Bank has
established correspondent relationships with the Independent Bankers' Bank of
Florida, NationsBank, Fifth Third Bank and Compass Bank. As compensation for
services provided by a correspondent, the Bank maintains certain balances with
such correspondent in non-interest bearing accounts. Such compensating balances
are not deemed significant to the Bank's operations.

DATA PROCESSING

         The Bank outsources its data and item processing through service
bureaus that provide data processing services, including an automated general
ledger, deposit accounting, and commercial, mortgage and installment lending
data processing, as well as item processing. For information regarding the
Bank's Year 2000 compliance, see "Management's Discussion and Analysis of
Financial Condition and Results of Operations," which is included in the Holding
Corporation's 1998 Annual Report to Shareholders and incorporated into this
Report under Item 7 of Part II.

EFFECT OF GOVERNMENTAL POLICIES

         The earnings and business of the Company are and will be affected by
the policies of various regulatory authorities of the United States, especially
the Board of Governors of the Federal Reserve System ("Federal Reserve Board").
The Federal Reserve Board, among other things, regulates the supply of credit
and deals with general economic conditions within the United States. The
instruments of monetary policy employed by the Federal Reserve Board for these
purposes influence in various ways the overall level of investments, loans,
other extensions of credit and deposits, and the interest rates paid on
liabilities and received on assets.

INTEREST AND USURY

         The Bank is subject to numerous state and federal statutes that affect
the interest rates that may be charged on loans. These laws do not, under
present market conditions, deter the Bank from continuing the process of
originating loans.

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SUPERVISION AND REGULATION

         Bank Holding Company Regulation. The Holding Corporation is a one-bank
holding company, registered with the Federal Reserve Board under the BHC Act. As
such, the Holding Corporation and the Bank are subject to the supervision,
examination, and reporting requirements of the BHC Act and the regulations of
the Federal Reserve Board. The Holding Corporation is required to furnish to the
Federal Reserve an annual report of its operations at the end of each fiscal
year, and such additional information as the Federal Reserve Board may require
pursuant to the BHC Act.

         The BHC Act requires every bank holding company to obtain the prior
approval of the Federal Reserve Board before (i) it may acquire direct or
indirect ownership or control of any voting shares of any bank if, after such
acquisition, the bank holding company will directly or indirectly own or control
more than 5% of the total voting shares of the bank, (ii) it or any of its
subsidiaries, other than a bank, may acquire all or substantially all of the
assets of the bank, or (iii) it may merge or consolidate with any other bank
holding company.

         The BHC Act further provides that the Federal Reserve may not approve
any transaction that would result in a monopoly or would be in furtherance of
any combination or conspiracy to monopolize or attempt to monopolize the
business of banking in any section of the United States, or the effect of which
may be substantially to lessen competition or to tend to create a monopoly in
any section of the country, or that in any other manner would be in restraint of
trade, unless the anticompetitive effects of the proposed transaction are
clearly outweighed by the public interest in meeting the convenience and needs
of the community to be served. The Federal Reserve is also required to consider
the financial and managerial resources and future prospects of the bank holding
companies and banks concerned and the convenience and needs of the community to
be served. Consideration of financial resources generally focuses on capital
adequacy and consideration of convenience and needs issues includes the parties'
performance under the Community Reinvestment Act of 1977 (the "CRA"), both of
which are discussed below.

         Banks are subject to the provisions of the CRA. Under the terms of the
CRA, the appropriate federal bank regulatory agency is required, in connection
with its examination of a bank, to assess such bank's record in meeting the
credit needs of the community served by that bank, including low-and
moderate-income neighborhoods. The regulatory agency's assessment of the bank's
record is made available to the public. Further, such assessment is required of
any bank which has applied to (i) charter a national bank, (ii) obtain deposit
insurance coverage for a newly chartered institution, (iii) establish a new
branch office that will accept deposits, (iv) relocate an office, or (v) merge
or consolidate with, or acquire the assets or assume the liabilities of, a
federally regulated financial institution. In the case of a bank holding company
applying for approval to acquire a bank or other bank holding company, the
Federal Reserve will assess the record of each subsidiary bank of the applicant
bank holding company, and such records may be the basis for denying the
application.


                                        5

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         The BHC Act generally prohibits the Holding Corporation from engaging
in activities other than banking or managing or controlling banks or other
permissible subsidiaries and from acquiring or retaining direct or indirect
control of any company engaged in any activities other than those activities
determined by the Federal Reserve Board to be so closely related to banking or
managing or controlling banks as to be a proper incident thereto. In determining
whether a particular activity is permissible, the Federal Reserve Board must
consider whether the performance of such an activity reasonably can be expected
to produce benefits to the public, such as greater convenience, increased
competition, or gains in efficiency, that outweigh possible adverse effects,
such as undue concentration of resources, decreased or unfair competition,
conflicts of interests, or unsound banking practices. For example, factoring
accounts receivable, acquiring or servicing loans, leasing personal property,
conducting discount securities brokerage activities, performing certain data
processing services, acting as agent or broker in selling credit life insurance
and certain other types of insurance in connection with credit transactions, and
performing certain insurance underwriting activities all have been determined by
the Federal Reserve Board to be permissible activities of bank holding
companies. Despite prior approval, the Federal Reserve Board has the power to
order a bank holding company or its subsidiaries to terminate any activity or to
terminate its ownership or control of any subsidiary when it has reasonable
cause to believe that continuation of such activity or such ownership or control
constitutes a serious risk to the financial safety, soundness, or stability of
any bank subsidiary of that bank holding company.

         Bank Regulation. The Bank is chartered under the laws of the State of
Florida and its deposits are insured by the FDIC to the extent provided by law.
The Bank is subject to comprehensive regulation, examination and supervision by
the Florida Department of Banking and Finance (the "Florida Department") and the
FDIC and to other laws and regulations applicable to banks. Such regulations
include limitations on loans to a single borrower and to its directors, officers
and employees; restrictions on the opening and closing of branch offices; the
maintenance of required capital and liquidity ratios; the granting of credit
under equal and fair conditions; and the disclosure of the costs and terms of
such credit. The Bank is examined periodically by both the Florida Department
and the FDIC, to each of whom it submits periodic reports regarding its
financial condition and other matters. Both the Florida Department and the FDIC
have a broad range of powers to enforce regulations under their respective
jurisdiction, and to take discretionary actions determined to be for the
protection of the safety and soundness of the Bank, including the institution of
cease and desist orders and the removal of directors and officers. These
regulatory agencies also have the authority to approve or disapprove mergers,
consolidations, and similar corporate actions.

         There are various statutory and contractual limitations on the ability
of the Bank to pay dividends, extend credit, or otherwise supply funds to the
Holding Corporation. The FDIC and the Florida Department also have the general
authority to limit the dividends paid by insured banks and bank holding
companies if such payment may be deemed to constitute an unsafe and unsound
practice. Dividends and management fees from the Bank constitute the sole source
of funds for dividends to be paid by the Holding Corporation. Under Florida law
applicable to banks and subject to certain limitations, after charging off bad
debts, depreciation and other worthless assets, if any, and making provisions
for reasonably anticipated future losses on loans and other assets, the board

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of directors of a bank may declare a dividend of so much of the bank's aggregate
net profits for the current year combined with its retained earnings (if any)
for the preceding two years as the board shall deem to be appropriate and, with
the approval of the Florida Department, may declare a dividend from retained
earnings for prior years. Before declaring a dividend, a bank must carry 20% of
its net profits for any preceding period as is covered by the dividend to its
surplus fund, until the surplus fund is at least equal to the amount of its
common stock then issued and outstanding. No dividends may be paid at any time
when a bank's net income from the preceding two years is a loss or which would
cause the capital accounts of the bank to fall below the minimum amount required
by law, regulation, order or any written agreement with the Florida Department
or a federal regulatory agency. Florida law applicable to companies (including
the Holding Corporation) provides that dividends may be declared and paid only
if, after giving it effect, (i) the company is able to pay its debts as they
become due in the usual course of business, and (ii) the company's total assets
would be greater than the sum of its total liabilities plus the amount that
would be needed if the company were to be dissolved at the time of the dividend
to satisfy the preferential rights upon dissolution of shareholders whose
preferential rights are superior to those receiving the dividend.

         Under federal law, federally insured banks are subject, with certain
exceptions, to certain restrictions on any extension of credit to their parent
holding companies or other affiliates, on investment in the stock or other
securities of affiliates, and on the taking of such stock or securities as
collateral from any borrower. In addition, such banks are prohibited from
engaging in certain tie-in arrangements in connection with any extension of
credit or the providing of any property or service.

         The Financial Institutions Reform, Recovery and Enforcement Act of 1989
("FIRREA") contained major regulatory reforms, stronger capital standards for
savings and loan associations and stronger civil and criminal enforcement
provisions. FIRREA also provided that a depository institution insured by the
FDIC can be held liable for any loss incurred by, or reasonably expected to be
incurred by, the FDIC in connection with (i) the default of a commonly
controlled FDIC insured depository institution, or (ii) any assistance provided
by the FDIC to a commonly controlled FDIC insured institution in danger of
default.

         The FDIC Improvement Act of 1991 ("FDICIA") made a number of reforms
addressing the safety and soundness of deposit insurance funds, supervision,
accounting, and prompt regulatory action, and also implements other regulatory
improvements. FDICIA also recapitalized the Bank Insurance Fund. Annual
full-scope, on-site examinations are required of all insured depository
institutions. The cost for conducting an examination of an institution may be
assessed to that institution, with special consideration given to affiliates and
any penalties imposed for failure to provide information requested. Insured
state banks also are precluded from engaging as principal in any type of
activity that is impermissible for a national bank, including activities
relating to insurance and equity investments. FDICIA also recodified current law
restricting extensions of credit to insiders under the Federal Reserve Act.


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         Also important in terms of its effect on banks has been the
deregulation of interest rates paid by banks on deposits and the types of
deposit accounts that may be offered by banks. Most regulatory limits on
permissible deposit interest rates and minimum deposit amounts expired several
years ago. The effect of the deregulation of deposit interest rates generally
has been to increase the costs of funds to banks and to make their costs of
funds more sensitive to fluctuations in money market rates. A result of the
pressure on banks' interest margins due to deregulation has been a trend toward
expansion of services offered by banks and an increase in the emphasis placed on
fee or non-interest income.

         The Bank is directly affected by government monetary and fiscal policy
and by regulatory measures affecting the banking industry and the economy in
general. The actions of the Board of Governors of the Federal Reserve as the
nation's central bank can directly affect the money supply and, in general,
affect the lending activities of banks by increasing or decreasing their cost
and availability of funds. An important function of the Federal Reserve Board is
to regulate the national supply of bank credit. Among the instruments of
monetary policy used by the Federal Reserve Board to implement this objective
are open market operations in United States government securities, changes in
the discount rate on member bank borrowings and changes in reserve requirements
against bank deposits. These means are used in varying combinations to influence
overall growth of bank loans, investments and deposits, and interest rates
charged on loans or paid on deposits. The monetary policies of the Federal
Reserve Board have had a significant effect on the operating results of
commercial banks in the past and are expected to continue to do so in the
future.

         Congress has provided the federal bank regulatory agencies with an
array of powers to enforce laws, rules, regulations and orders. Among other
things, the agencies may require that institutions cease and desist from certain
activities, may preclude persons from participating in the affairs of insured
depository institutions, may suspend or remove deposit insurance, and may impose
civil money penalties against institution-affiliated parties for certain
violations.

         The foregoing is a brief summary of certain statutes, rules, and
regulations affecting the Company and the Bank. Numerous other statutes and
regulations have an impact on the operations of the Company and the Bank.
Supervision, regulation, and examination of banks by the bank regulatory
agencies are intended primarily for the protection of depositors, not
shareholders.

         Insurance of Deposits. The Bank's deposit accounts are insured by the
FDIC up to a maximum of $100,000 per insured depositor. The FDIC issues
regulations, conducts periodic examinations, requires the filing of reports and
generally supervises the operations of its insured banks. Any insured bank which
is not operated in accordance with or does not conform to FDIC regulations,
policies and directives may be sanctioned for non-compliance. Proceedings may be
instituted against any insured bank or any director, officer, or employee of
such bank engaging in unsafe and unsound practices, including the violation of
applicable laws and regulations. The FDIC has the authority to terminate
insurance of accounts pursuant to procedures established for that purpose.


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<PAGE>   12


         Bank Branching. Florida banks are permitted by statute to branch
statewide. Such branch banking, however, is subject to prior approval by the
Florida Department and the FDIC. Any approval by the Florida Department and the
FDIC would take into consideration several factors, including the Bank's level
of capital, the prospects and economics of the proposed branch office, and other
considerations deemed relevant by the Florida Department and the FDIC for
purposes of determining whether approval should be granted to open a branch
office.

         Capital Requirements. Regulatory agencies have approved guidelines to
implement a risk-based capital framework that makes capital requirements more
sensitive to the risk profiles of individual banking companies. These guidelines
define capital as either core (Tier 1) capital or supplementary (Tier 2)
capital. Tier 1 capital consists primarily of shareholders' equity, while Tier 2
capital is comprised of certain debt instruments and a portion of the allowance
for loan losses. The Bank is required to have a Tier 1 capital ratio of 4% and a
total risk-based capital ratio (Tier 1 plus Tier 2) of 8%. At December 31, 1998,
the Bank's Tier 1 and total risk-based capital ratios were 16.19% and 17.45%,
respectively.

         FDICIA contains "prompt corrective action" provisions pursuant to which
banks are to be classified into one of five categories based upon capital
adequacy, ranging from "well capitalized" to "critically undercapitalized" and
which require (subject to certain exceptions) the appropriate federal banking
agency to take prompt corrective action with respect to an institution which
becomes "significantly undercapitalized" or "critically undercapitalized".

         The FDIC has issued regulations to implement the "prompt corrective
action" provisions of FDICIA. In general, the regulations define the five
capital categories as follows: (i) an institution is "well capitalized" if it
has a total risk-based capital ratio of 10% or greater, has a Tier 1 risk-based
capital ratio of 6% or greater, has a leverage ratio of 5% or greater and is not
subject to any written capital order or directive to meet and maintain a
specific capital level for any capital measures; (ii) an institution is
"adequately capitalized" if it has a total risk-based capital ratio of 8% or
greater, has a Tier 1 risk-based capital ratio of 4% or greater, and has a
leverage ratio of 4% or greater; (iii) an institution is "undercapitalized" if
it has a total risk-based capital ratio of less than 8%, has a Tier 1 risk-based
capital ratio that is less than 4% or has a leverage ratio that is less than 4%;
(iv) an institution is "significantly undercapitalized" if it has a total
risk-based capital ratio that is less than 6%, a Tier 1 risk-based capital ratio
that is less than 3% or a leverage ratio that is less than 3%; and (v) an
institution is "critically undercapitalized" if its "tangible equity" is equal
to or less than 2% of its total assets. The FDIC also, after an opportunity for
a hearing, has authority to downgrade an institution from "well capitalized" to
"adequately capitalized" or to subject an "adequately capitalized" or
"under-capitalized" institution to the supervisory actions applicable to the
next lower category, for supervisory concerns. At December 31, 1998, the Bank
had a total risk-based capital ratio of 17.45%, a Tier 1 risk-based capital
ratio of 16.19%, and a leverage ratio of 10.00%.

         Generally, FDICIA requires that an "undercapitalized" institution must
submit an acceptable capital restoration plan to the appropriate federal banking
agency within 45 days after the institution becomes "undercapitalized" and the
agency must take action on the plan within 60 days. The


                                        9

<PAGE>   13



appropriate federal banking agency may not accept a capital restoration plan
unless, among other requirements, each company having control of the institution
has guaranteed that the institution will comply with the plan until the
institution has been adequately capitalized on average during each of the four
consecutive calendar quarters and has provided adequate assurances of
performance. The aggregate liability under this provision of all companies
having control of an institution is limited to the lesser of (i) 5% of the
institution's total assets at the time the institution becomes
"undercapitalized" or (ii) the amount which is necessary, or would have been
necessary, to bring the institution into compliance with all capital standards
applicable to the institution as of the time the institution fails to comply
with the plan filed pursuant to FDICIA.

         An "undercapitalized" institution may not acquire an interest in any
company or any other insured depository institution, establish or acquire
additional branch offices or engage in any new business unless the appropriate
federal banking agency has accepted its capital restoration plan, the
institution is implementing the plan, and the agency determines that the
proposed action is consistent with and will further the achievement of the plan,
or the FDIC determines the proposed action will further the purpose of the
"prompt corrective action" sections of FDICIA.

         If an institution is "critically undercapitalized," it must comply with
the restrictions described above. In addition, the FDIC is authorized to
restrict the activities of any "critically undercapitalized" institution and to
prohibit such an institution, without the FDIC's prior written approval, from:
(i) entering into any material transaction other than in the usual course of
business; (ii) engaging in any covered transaction with affiliates (as defined
in Section 23A(b) of the Federal Reserve Act); (iii) paying excessive
compensation or bonuses; and (iv) paying interest on new or renewed liabilities
at a rate that would increase the institution's weighted average costs of funds
to a level significantly exceeding the prevailing rates of interest on insured
deposits in the institution's normal market areas.

         The "prompt corrective action" provisions of FDICIA also provide that
in general no institution may make a capital distribution if it would cause the
institution to become "under-capitalized". Capital distributions include cash
(but not stock) dividends, stock purchases, redemptions, and other distributions
of capital to the owners of an institution.

         Additionally, FDICIA requires, among other things, that (i) only a
"well capitalized" depository institution may accept brokered deposits without
prior regulatory approval and (ii) the appropriate federal banking agency
annually examine all insured depository institutions, with some exceptions for
small, "well capitalized" institutions and state-chartered institutions examined
by state regulators. FDICIA also contains a number of consumer banking
provisions, including disclosure requirements and substantiative contractual
limitations with respect to deposit accounts.

         Interstate Banking. The Riegle-Neal Interstate Banking and Branching
Efficiency Act of 1995 provides for nationwide interstate banking and branching.
Under the law, interstate acquisitions of banks or bank holding companies in any
state by bank holding companies in any other state will be permissible one year
after enactment. Interstate branching and consolidation of existing


                                       10

<PAGE>   14



bank subsidiaries in different states also is permissible. The Florida
legislature also has enacted a law that allows out-of-state bank holding
companies (located in states that allow Florida bank holding companies to
acquire banks and bank holding companies in that state) to acquire Florida banks
and Florida bank holding companies. The law essentially provides for
out-of-state entry by acquisition only (and not by interstate branching) and
requires the acquired Florida bank to have been in existence for at least two
years.

INDUSTRY RESTRUCTURING

         For well over a decade, the banking industry has been undergoing a
restructuring process which is anticipated to accelerate during the next decade.
The restructuring has been caused by the dramatic product and technological
innovations in the financial services industry, deregulation of interest rates,
and increased competition from foreign and nontraditional banking competitors,
and has been characterized principally by the gradual erosion of geographic
barriers to intrastate and interstate banking, the gradual expansion of
investment and lending authorities for bank institutions, and the failure of a
growing number of financial institutions.

         Members of Congress and the administration have indicated their
intention to consider additional legislation designed to institute reforms to
promote the viability of the industry. Certain of the proposals would revise the
federal regulatory structure for insured depository institutions; others would
affect the nature of products, services, and activities that bank holding
companies and their subsidiaries may offer or engage in, and the types of
entities that may control depository institutions. There can be no assurance as
to whether or in what form any such proposed legislation might be enacted, or
what impact such legislation might have upon the Company.

COMPETITION

         The Company encounters strong competition both in making loans and
attracting deposits. The deregulation of the banking industry and the widespread
enactment of state laws which permit multi-bank holding companies as well as an
increasing level of interstate banking have created a highly competitive
environment for commercial banking in Lee County. In one or more aspects of its
business, the Bank competes with other commercial banks, savings and loan
associations, credit unions, finance companies, mutual funds, insurance
companies, brokerage and investment banking companies, and other financial
intermediaries operating in Lee County and elsewhere. Most of these competitors,
some of which are affiliated with bank holding companies, have substantially
greater resources and lending limits, and may offer certain services that the
Bank does not currently provide. In addition, many of the Bank's non-bank
competitors are not subject to the same extensive federal regulations that
govern bank holding companies and federally insured banks. Recent federal and
state legislation has heightened the competitive environment in which financial
institutions must conduct their business, and the potential for competition
among financial institutions of all types has increased significantly.


                                       11

<PAGE>   15



         To compete, the Bank relies upon specialized services, responsive
handling of customer needs, and personal contacts by its officers, directors,
and staff. The large multi-branch banks compete primarily by rate and location
of branches and smaller independent financial institutions tend to compete
primarily by rate.

EMPLOYEES

         As of December 31, 1998, the Company had 37 full-time employees and
four part-time employees. The employees are not represented by a collective
bargaining unit. The Company believes that its employee relations are excellent.

STATISTICAL PROFILE AND OTHER FINANCIAL DATA

         Reference is hereby made to the statistical and financial data
contained in the section captioned "Management's Discussion and Analysis of
Financial Condition and Results of Operations," which is included in the Holding
Corporation's 1998 Annual Report to Shareholders and incorporated in this report
under Item 7 of Part II, for statistical and financial data providing a review
of the Company's business activities.

ITEM 2.       PROPERTIES

      The Bank's main office is located at 2017 McGregor Boulevard, in the
downtown area of the City of Fort Myers, Florida. The property is an older
two-story building of approximately 6,500 square feet, which is owned by the
Bank. The Bank also leases space adjacent to the main office until 1999.

      The Bank has a branch office located at 1500 Colonial Boulevard. The Bank
leases space in a two-story building for a term expiring in 2000, with three
renewal options for additional five-year periods each. The Bank also has a
branch office located at the intersection of Daniels Road and Metro Parkway and
operating out of a modular building. The Bank leases ground space for the office
pursuant to an one-year lease expiring in 1999. The land is being leased from a
general partnership in which certain of the directors of the Holding Corporation
and the Bank serve as general partners. The Bank has a branch office located at
15280 McGregor Boulevard, which is leased for a term expiring in 2002.

ITEM 3.       LEGAL PROCEEDINGS

      The Bank is a party to various legal proceedings in the ordinary course of
its business, including proceedings to collect loans or enforce security
interests. In the opinion of management of the Company, none of the legal
proceedings currently pending will, when resolved, have a material adverse
effect on the business or financial condition of the Company on a consolidated
basis.



                                       12

<PAGE>   16



ITEM 4.       SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

      No matters were submitted to a vote of Holding Corporation security
holders during the fourth quarter of the year ended December 31, 1998.

























                                       13

<PAGE>   17



                                    PART II

ITEM 5.       MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER 
              MATTERS

      The information contained under the section captioned "Capital Stock" in
the Annual Report is incorporated herein by reference.

ITEM 6.      MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
             AND RESULTS OF OPERATIONS

      The information contained in the section captioned "Management's
Discussion and Analysis of Financial Condition and Results of Operations" in the
Annual Report is incorporated herein by reference.

ITEM 7.       FINANCIAL STATEMENTS

      The following financial statements and the supplementary financial
information included in the 1998 Annual Report to Shareholders are incorporated
herein by reference:

         1.       The consolidated financial statements, together with the
report thereon of Brewer, Beemer, Kuehnhackl & Koon, P.A. dated January 29,
1999.

         2.       Management's Discussion and Analysis of Financial Condition
and Results of Operations and related statistical information.

      With the exception of the aforementioned information and the information
incorporated in Items 5, 6, 7, and 8, the 1998 Annual Report to Shareholders is
not to be deemed filed as part of this Form 10-K Report.

ITEM 8.    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND 
           FINANCIAL DISCLOSURE

      None





                                       14

<PAGE>   18



                                    PART III

ITEM 9.    DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; 
           COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT

DIRECTORS

         The following table sets forth the name of each director of the Holding
Corporation; a description of his or her position and offices with the Holding
Corporation other than as a director, if any; a brief description of his or her
principal occupation and business experience during at least the last five
years; and certain other information including the director's age and the number
of shares of Holding Corporation Common Stock beneficially owned by the director
on March 12, 1999. Each of the following individuals is also serving as a
director of the Bank (collectively, the "Company").

<TABLE>
<CAPTION>
                                                                                 AMOUNT, PERCENTAGE
                                                                                    AND NATURE OF
                                                                                BENEFICIAL OWNERSHIP
DIRECTOR AND YEAR                     INFORMATION ABOUT                        OF HOLDING CORPORATION
  FIRST ELECTED                            DIRECTOR                                COMMON STOCK (1)
-------------------                 ---------------------                      -----------------------
<S>                             <C>                                            <C>
                                            CLASS III
                                TERM EXPIRES ANNUAL MEETING 1999

James T. Humphrey, Jr.          Mr. Humphrey has been a partner                        31,500 (2)
1990                            in the law firm of Humphrey & Knott,                   (2.5%)
                                P.A. in Fort Myers since 1982.  Mr.
                                Humphrey is 58.


George T. Mann, Jr.             Mr. Mann is President of George T. Mann                4,750 (3)
1996                            General Contractor, Inc. since 1985. He                (.38%)
                                served on the Board of Directors of First
                                Federal Savings & Loan Association of
                                Fort Myers and, subsequently, Society/First
                                Federal from 1980 through 1996.  Mr.
                                Mann is 59.

Wallace M. Tinsley              Mr. Tinsley is presently retired.                      39,166 (4)
1990                            From 1984 to 1988, he served as                        (3.1%)
                                President of Fort Myers Auto Parts.
                                Mr. Tinsley is 68.
</TABLE>



                                       15

<PAGE>   19



                                     CLASS I
                        TERM EXPIRES ANNUAL MEETING 2000

<TABLE>
<S>                             <C>                                                    <C>
Ronald D. Focht                 Mr. Focht is President and owner of                    51,192 (5)
1993                            United Welding and Machine Company                     (4.0%)
                                since 1976.  Mr. Focht is 53.

Robert Ernest Hendry            Dr. Hendry has been engaged                            45,420 (6)
1990                            in private practice as a dentist                       (3.6%)
                                in Fort Myers since 1962.  Dr.
                                Hendry has served as Chairman
                                of the Board of the Holding
                                Corporation since February
                                1991.  Dr. Hendry is 63.
</TABLE>

                                    CLASS II
                        TERM EXPIRES ANNUAL MEETING 2001

<TABLE>
<S>                             <C>                                                    <C>
Robert C. Adkins                Mr. Adkins has served as President                     46,350 (7)
1990                            and General Manager of Dixie Buick, Inc.                (3.7%)
                                in Fort Myers since 1961.
                                Mr. Adkins is 65.

Carole A. Green                 Ms. Green is a Florida State Legislator                1,610
1996                            for District 75.  She served on the Board              (.13%)
                                of Lee Memorial Health System from 1995
                                through 1998.  She also serves on The
                                Children's Hospital Development Board
                                and the Lee Memorial Foundation.  Ms. Green
                                is 47.

William P. Valenti              Mr. Valenti has over 30 years of banking               41,250 (8)
1992                            experience, including serving as President              (3.3%)
                                and Chief Executive Officer of the Holding
                                Corporation and the Bank since February 1992.
                                Mr. Valenti is 54.
</TABLE>


 --------------------

(1)      Information relating to beneficial ownership of Holding Corporation
         Common Stock by directors is based upon information furnished by each
         person using "beneficial ownership" concepts set forth in rules of the
         Securities and Exchange Commission under the Securities

                                       16

<PAGE>   20



         Exchange Act of 1934, as amended. Under such rules, a person is deemed
         to be a "beneficial owner" of a security if that person has or shares
         "voting power," which includes the power to vote or direct the voting
         of such security, or "investment power," which includes the power to
         dispose of or to direct the disposition of such security. A person is
         also deemed to be a beneficial owner of any security of which that
         person has a right to acquire beneficial ownership within 60 days.
         Under such rules, more than one person may be deemed to be a beneficial
         owner of the same securities, and a person may be deemed to be a
         beneficial owner of securities as to which he or she may disclaim any
         beneficial interest. Accordingly, nominees and directors continuing in
         office are named as beneficial owners of shares as to which they may
         disclaim any beneficial interest. Except as otherwise indicated in the
         notes to this table, directors possessed sole voting and investment
         power as to all shares of Holding Corporation Common Stock set forth
         opposite their names.

(2)      Includes 17,500 shares (as to which he shares voting power) owned by
         his law firm's profit sharing plan, 11,500 shares held jointly with his
         spouse, and 2,500 shares owned by his IRA.

(3)      Consists of shares held by him as trustee.

(4)      Includes 24,258 shares owned individually by Mr. Tinsley, 14,508 shares
         owned by his spouse and 400 shares owned by his spouse's IRA.

(5)      Shares held jointly with spouse.

(6)      Represents 33,400 shares held in Dr. Hendry's retirement trust and
         12,020 shares owned individually by Dr. Hendry.

(7)      Includes 25,550 shares owned individually by Mr. Adkins, 14,000 shares
         owned by his spouse, 5,000 shares owned by Dixie Buick, Inc., a
         corporation controlled by Mr. Adkins, and 1,800 shares held by his
         spouse in trust for minor children.

(8)      Includes 3,250 shares which Mr. Valenti has the right to acquire
         pursuant to presently exercisable stock options, 33,850 shares held
         jointly with his spouse, 100 shares held jointly with his parent, 50
         shares owned by his spouse, and 4,000 shares owned by his IRA.

EXECUTIVE OFFICERS

         The following lists the executive officers of the Holding Corporation,
all positions held by them in the Holding Corporation, including the period each
such position has been held, a brief account of their business experience during
the past five years and certain other information including their ages.
Executive officers are appointed annually at the organizational meeting of the
Board of Directors, which follows the Holding Corporation annual meeting of
shareholders, to serve until a successor has been duly elected and qualified or
until his death, resignation, or removal from


                                       17

<PAGE>   21



office. Information concerning directorships, committee assignments, minor
positions and peripheral business interests has not been included.


                      SECTION 16(A) REPORTING REQUIREMENTS

         Under Section 16(a) of the Securities Exchange Act of 1934, directors
and executive officers of the Holding Corporation, and persons who beneficially
own more than 10% of Holding Corporation Stock, are required to make certain
filings on a timely basis with the Securities and Exchange Commission. Reporting
persons are required by SEC regulations to furnish the Holding Corporation with
copies of all Section 16(a) forms filed by them. Based on its review of the
copies of Section 16(a) forms received by it, and on written representations
from reporting persons concerning the necessity of filing a Form 5 - Annual
Statement of Changes in Beneficial Ownership, the Company believes that, during
1998, all filing requirements applicable to reporting persons were met.


ITEM 10.          EXECUTIVE COMPENSATION

INFORMATION ABOUT THE BOARD OF DIRECTORS AND ITS COMMITTEES

         The Board of Directors of the Holding Corporation held 15 meetings
during the year ended December 31, 1998. All of the directors attended at least
75% of the aggregate total number of meetings of the Board of Directors and
meetings of the committees of the Board on which they serve. The Holding
Corporation's Board of Directors presently has three committees. Certain
information regarding the function of these standing committees, their
membership, and the number of meetings held during 1998 follows:

         The entire Board of Directors serves as the Nominating Committee for
the purpose of nominating persons to serve on the Board of Directors. While the
committee will consider nominees recommended by shareholders, it has not
actively solicited recommendations nor established any procedures for this
purpose. The Board held one meeting in its capacity as the Nominating Committee
during 1998.

         The Audit Committee reviews the annual audit, reports to the Board
concerning the audit and makes recommendations for improvements, internal
controls, or other items covered by the audit report. The Audit Committee also
directs the activities of the internal audit function. Ms. Green and Messrs.
Mann and Tinsley are the members of this committee. The committee held two
meetings during 1998.

         The Compensation Committee reviews the Holding Corporation's total
compensation and benefits program. It also makes recommendations to the Board
concerning compensation and other arrangements for executive officers of the
Holding Corporation as well as annual increases in

                                       18

<PAGE>   22



compensation for all employees. The members of this committee are Messrs. Adkins
and Focht and Dr. Hendry. The committee held two meetings during 1998.

         The Bank pays each outside director $700 per month ($900 per month to
Dr. Hendry as Chairman).

EXECUTIVE COMPENSATION AND BENEFITS

         The following table sets forth all cash compensation for the Holding
Corporation's Chief Executive Officer for services to the Company in 1998.

                           SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
                                                                         Long Term Compensation
--------------------------------------------------------------------------------------------------
                           Annual Compensation                      Awards                Payouts
--------------------------------------------------------------------------------------------------------------------
 Name
  and                                                   Other     Restricted 
Principal                                              Annual       Stock      Options/     LTIP       All Other
Position                Year    Salary      Bonus                  Award(s)      SARs     Payouts    Compensation
Compensation                                                                                             (2)
--------------------------------------------------------------------------------------------------------------------
<S>                     <C>   <C>          <C>        <C>         <C>          <C>        <C>        <C>       
William P.              1998  $ 132,000    $ 32,650   $5,650 (1)    -0-          -0-        -0-       $  3,775
Valenti, President      1997  $ 119,664    $ 20,000   $5,400 (1)    -0-          -0-        -0-       $  4,187
and Chief Executive     1996  $ 110,800    $ 15,000   $5,400 (1)    -0-          -0-        -0-       $  3,645
Officer of the Bank
</TABLE>

-----------------

(1)      Represents automobile allowance.
(2)      Represents amounts contributed by the Bank to Mr. Valenti's account in 
         the Section 401(k) Plan.


INFORMATION ON BENEFIT PLANS AND POLICIES

         Stock Option Plan. The Holding Corporation has an Officers' and
Employees' Stock Option Plan for its officers and employees (the "Plan"). The
purpose of the Plan is to advance the interests of the Company by affording to
the Company's officers an opportunity to increase their proprietary interest in
the continued growth and financial success of the Company. The Plan also
reenforces the Company's efforts to retain and attract highly competent
individuals upon whose judgment, initiative, leadership, and continued efforts,
the future viability and success of the Company in large measure depends.

         Under the Plan, 100,000 shares of Holding Corporation Common Stock are
reserved for issuance, subject to antidilution adjustments. Of this amount, as
of March 12, 1999, options for 3,250 and 1,500 shares were issued to William P.
Valenti and Harold S. Taylor, Jr., respectively, with the exercise price for
3,500 shares at $5.00 per share and with an exercise price of $10.50 for the
remaining 1,250 shares. The balance of the shares are reserved for issuance to
Company officers and employees as the Board of Directors in its discretion shall
determine. The Plan provides that


                                       19

<PAGE>   23



the option price must be paid in cash and in an amount equal to the greater of
$5.00 or the fair market value of the stock on the date of grant.

         Under the Plan, the Board of Directors may elect to make awards of both
incentive stock options intended to meet the requirements of certain sections of
the Internal Revenue Code of 1986, as amended, from time to time, and
nonqualified stock options which do not meet such requirements.

         During each of the first four years following the grant of an option
under the Plan, 25% of the option granted may be exercised. If an option is not
exercised in any one year, it may be exercised in a later year. Of the 3,250
options granted to Mr. Valenti, 1,500 are not subject to the foregoing
limitations but are immediately exercisable, and the remaining options for 1,750
shares are subject to such limitations. Any options not exercised within 10
years from the date of grant shall expire. If a participant ceases to be
employed by the Company because of disability or death, the participant (or his
estate as the case may be) may exercise options which were exercisable upon such
termination of employment for three months (in the case of disability or
retirement) and six months (in the case of death) after such termination. If a
participant ceases to be employed by the Company for any reason except death,
disability or retirement, any option or options granted him under the Plan which
have not been exercised shall be deemed cancelled. Upon any merger, combination,
sale of substantially all of the assets of the Company, or a change of control
of the Company (as defined in the Plan), all outstanding stock options become
immediately exercisable, regardless of how many years have passed since the date
of grant. No stock option may be transferred by an optionee otherwise then by
will or the laws of descent and distribution, and such stock option is
exercisable during the lifetime of the optionee, only by the optionee or a legal
guardian or personal representative.

         The Plan is administered by a committee consisting of all members of
the Board of Directors of the Holding Corporation who (at the time they
exercised discretion in making decisions under the Plan) are not, and have not
at any time for one year prior thereto been, eligible to receive an option under
the Plan. The administrative committee determines, subject to the provisions of
the Plan, which employees will receive options, the numbers of shares to be
optioned to any employee, the date of grant of each option, and all other terms
and conditions governing each option.

         The Board of Directors may at any time amend or terminate the Plan;
however, without the approval of the shareholders of the Holding Corporation,
the Board may not amend the Plan to increase the aggregate number of shares for
which options may be granted (except as may be necessary to adjust for certain
antidilution events) or alter the class of persons eligible to receive options
under the Plan. No amendment or termination of the Plan may, without the consent
of the optionee, adversely effect the rights of any options with respect to an
option or the unexercised portion thereof.

         The following sets forth certain information regarding options
outstanding to Mr. Valenti as of December 31, 1998:


                                       20

<PAGE>   24





         AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FY-END
                                OPTION/SAR VALUES


<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
                                                   NUMBER OF
                                                  SECURITIES         VALUE OF
                                                  UNDERLYING        UNEXERCISED
                         SHARES                   UNEXERCISED      IN-THE-MONEY
                        ACQUIRED                 OPTIONS/SARS      OPTIONS/SARS
                           ON         VALUE      AT FY-END (#)     AT FY-END($)
                        EXERCISE    REALIZED     EXERCISABLE/      EXERCISABLE/
       NAME               (#)         ($)       UNEXERCISABLE     UNEXERCISABLE
--------------------------------------------------------------------------------
<S>                     <C>         <C>         <C>               <C>   
William P. Valenti       32,750      211,503      1,500/1,750      $8,375/$8,625
--------------------------------------------------------------------------------
</TABLE>

         Employment Agreement. The Holding Corporation has entered into an
Employment Agreement with William P. Valenti (President and Chief Executive
Officer of the Holding Corporation and the Bank). During 1998, a base annual
salary of $132,000 was paid to Mr. Valenti. The agreement also includes
provisions for an automobile allowance, a term life insurance policy in the
amount of $500,000, and individual bonuses.

         The agreement terminates on June 30, 2001 and automatically renews for
successive one-year terms thereafter, unless either the Board of Directors or
the executive provides written notice to the other at least 30 days prior to the
end of the existing term. The agreement is terminable by the Bank for "cause",
as defined in the agreement at any time upon written notice to the executive.
Generally, the agreement also provides that (i) upon disability, the executive
is entitled to receive 66 2/3% of salary (during the initial exclusion period
for coverage under disability insurance policies for which the Company has paid
the premium); (ii) upon termination of the agreement for "cause", the executive
is entitled to salary and accrued and unpaid bonus amounts up to the date of
such termination; (iii) upon termination of the agreement without "cause", the
executive is entitled to salary plus medical and life insurance benefits for a
period of the greater of two years thereafter or until termination of the
employment agreement; and (iv) upon the death of the executive, the executive's
estate will be entitled to receive any accrued and unpaid salary at the date of
death, any bonuses payable to the executive, and accrued but unused vacation
time. The executive also will have been deemed to have been terminated without
cause if there is a change in control (as defined in the agreement) and,
following such change in control, there is a significant reduction in the
authority of the executive, his title, or his compensation, or a termination of
his employment (except for death, resignation, or disability). The employment
agreement also provides for the issuance to the executive of the stock options
discussed above under "Stock Option Plan."

         The employment agreement also contains a two-year non-competition
clause which applies following termination of the executive's service because of
resignation, retirement or termination of employment for "cause." The
non-competition prohibition applies to Lee County, Florida. The employment
agreement also contains provisions providing for non-solicitation of Bank
employees


                                       21

<PAGE>   25



for two years subsequent to the termination of the executive's service because
of resignation, retirement or termination of employment for "cause", and also
contains confidentiality provisions.

         Profit Sharing Plan. The Bank has adopted a 401(k) Profit Sharing Plan.
Employees are eligible to participate after meeting certain length of service
requirements. Each year, participants may elect to defer up to 15% of
compensation instead of receiving that amount in cash. The Bank may contribute a
matching amount up to the 15% of compensation amount. Amounts deferred by
participants are fully vested. Contributions by the Bank vest based on
percentage amounts of 25% to 100% over two to five years of service.


ITEM 11.          SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         As of March 12, 1999, based on available information, all directors and
officers of the Holding Corporation as a group (nine persons) beneficially owned
283,863 shares of Holding Corporation Common Stock which constituted 22.4% of
the number of shares outstanding at that date. For additional information
regarding the ownership of Holding Corporation Common Stock by Directors, see
Part III, Item 9 above.

         As of March 12, 1999, the only shareholders known to the Holding
Corporation to be beneficial owners, as defined by rules of the Securities and
Exchange Commission, of 5% or more of the outstanding shares of the Holding
Corporation Common Stock were Mr. Andrew J. Nychyk and Ewing/Florida Bank Stock
Fund, Limited Partnership. Beneficial ownership information with respect to
those two shareholders has been set forth in the following table.

<TABLE>
<CAPTION>
NAME AND ADDRESS                   AMOUNT AND NATURE OF        PERCENT
BENEFICIAL OWNER                   BENEFICIAL OWNERSHIP       OF CLASS
----------------                   --------------------       --------
<S>                                <C>                        <C> 
Andrew J. Nychyk                            92,441 (1)          7.3%
2606 Cortez Boulevard
Fort Myers, FL 33901

Ewing/Florida Bank Stock Fund,              75,000              5.9%
Limited Partnership
Post Office Box 568589
Orlando, Florida   32856-8589
</TABLE>


(1)      Includes 20,500 shares owned by his spouse, as to which shares he
         disclaims beneficial ownership.



                                       22

<PAGE>   26



ITEM 12.          CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         The Bank has entered into a ground lease with The Daniels & Metro
Group, a Florida general partnership, for the property on which its Metro branch
office is located. Messrs. Humphrey and Tinsley (directors of the Holding
Corporation), along with their affiliates, owned or controlled as of March 12,
1999, an aggregate of approximately 14.27% of The Daniels & Metro Group. The
property is being leased until August 31, 1999 at a monthly rental of $3,500,
and may be terminated by either party upon four months' prior written notice to
the other. The Bank believes that, based on an independent appraisal of the fair
rental value of the property, the transaction is on terms no less favorable than
which could have been obtained by the Bank from parties not affiliated with the
Bank.

         The Bank has entered into a lease of office space owned by Mann
Enterprises, of which George T. Mann, Jr. is a partner. The property is
currently being leased for $1,909.62 per month. The lease, which expires April
30, 1999, has two renewal options for three years each. Mr. Mann is a director
of both the Holding Corporation and the Bank.

         The law firm of Humphrey & Knott, P.A. serves as legal counsel for the
Bank and received $28,960.00 of fees for legal services rendered during 1998.
Mr. Humphrey, a senior member of the firm, is a director of both the Holding
Corporation and the Bank.

         The Bank has outstanding loans to certain of its directors, executive
officers, their associates and members of the immediate families of such
directors and executive officers. These loans were made in the ordinary course
of business, were made on substantially the same terms, including interest rates
and collateral, as those prevailing at the time for comparable transactions with
persons not affiliated with the Bank and did not involve more than the normal
risk of collectibility or present other unfavorable features.


ITEM 13.          EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON 
                  FORM 8-K

         (A)      THE FOLLOWING DOCUMENTS ARE FILED AS PART OF THIS REPORT:

         1.       FINANCIAL STATEMENTS

                  Report of Independent Certified Public Accountants

                  Consolidated Statements of Financial Condition as of December
                  31, 1998 and 1997

                  Consolidated Statements of Operations for the years ended
                  December 31, 1998, 1997, and 1996

                  Consolidated Statements of Changes in Shareholders' Equity for
                  the years ended December 31, 1998, 1997, and 1996


                                       23

<PAGE>   27



                  Consolidated Statements of Cash Flows for the years ended
                  December 31, 1998, 1997, and 1996

                  Notes to Consolidated Financial Statements

         2.       FINANCIAL STATEMENT SCHEDULES

                  All schedules have been omitted as the required information is
                  either inapplicable or included in the Notes to Consolidated
                  Financial Statements.

         3.       EXHIBITS

                  3.1      Articles of Incorporation of South Florida Bank
                           Holding Corporation (Incorporated by reference to
                           Exhibit 3.1 to the Holding Corporation's Registration
                           Statement No. 33-37385 (the "Registration
                           Statement")).

                  3.2      Articles of Amendment to Articles of Incorporation of
                           South Florida Bank Holding Corporation (Incorporated
                           by reference to Exhibit 3.2 to the Holding
                           Corporation's Form 10-K for its year ending December
                           31, 1993).

                  3.3      Amended and Restated Bylaws of the Holding
                           Corporation (Incorporated by reference to Exhibit 3.2
                           to the Holding Corporation's Form 10-K for its year
                           ended December 31, 1990).

                  10.1     Employment Agreement dated June 9, 1998 between South
                           Florida Bank Holding Corporation and William P.
                           Valenti. *

                  10.2     Employment Agreement dated July 1, 1998 between South
                           Florida Bank Holding Corporation and Harold S.
                           Taylor, Jr. *

                  10.3     South Florida Bank Holding Corporation Officers' and
                           Employees' Stock Option Plan (Incorporated by
                           reference to Exhibit 10.4 to the Holding
                           Corporation's Form 10-K for its year ended December
                           31, 1993).*

                  10.4     South Florida Bank Holding Corporation Incentive
                           Stock Option Agreement dated April 27, 1993 with
                           William P. Valenti (Incorporated by reference to
                           Exhibit 10.5 to the Holding Corporation's Form 10-K
                           for its year ended December 31, 1993).*

                  10.5     South Florida Bank Holding Corporation Incentive
                           Stock Option Agreement dated February 15, 1995 with
                           Harold S. Taylor, Jr. (Incorporated by reference to
                           Exhibit 10.7 to the Holding Corporation's Form 10-K
                           for its year ended December 31, 1993).*


                                       24

<PAGE>   28



                  10.6     Lease Agreement dated December 8, 1989 between Apex
                           Properties and South Florida Bank regarding lease of
                           branch banking office at 1500 Colonial Boulevard,
                           Fort Myers, Florida (Incorporated by reference to
                           Exhibit 10.7 to the Registration Statement)

                  10.7     Letter dated August 18, 1997 relating to Daniels &
                           Metro Parkway Lease Extension (Incorporated by
                           reference to Exhibit 10.8 to the Holding
                           Corporation's Form 10-K for its year ended December
                           31, 1997).

                  10.8     Lease Agreement dated July 31, 1992 between The
                           Daniels & Metro Group and South Florida Bank
                           regarding lease of branch banking office at the
                           northeast corner of Metro Parkway, Lee County,
                           Florida (Incorporated by reference to listing of
                           Exhibits to the Holding Corporation's Form 10-K for
                           its year ended December 31, 1992).

                  10.9     Lease Agreement dated April 25, 1990 by and between
                           Mann Enterprises and the Bank (and amendment thereto
                           dated June 27, 1997) (Incorporated by reference to
                           Exhibit 10.10 to the Holding Corporation's Form
                           10-KSB for its year ended December 31, 1996).

                  10.10    Lease for Branch Bank dated May 14, 1997 by and
                           between Arthur K. Knudsen, Jr. and Christie K.
                           Knudsen and the Bank regarding lease of real property
                           at 15280 McGregor Boulevard, Fort Myers, Florida
                           (Incorporated by reference to Exhibit 10.11 to the
                           Holding Corporation's Form 10-K for its year ended
                           December 31, 1997).

                  13.1     South Florida Bank Holding Corporation 1998 Annual
                           Report

                  21.1     Subsidiaries of the Registrant.

                  27       Financial Data Schedule (for SEC use only)

      (b)  REPORTS ON FORM 8-K

           No Current Reports on Form 8-K were filed by the Holding Corporation
           during the last fiscal quarter covered by this report.

-----------------------
*   Represents a management contract or compensatory plan or arrangement
    required to be filed as an exhibit.


                                       25

<PAGE>   29



                                   SIGNATURES

      Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City of Fort
Myers, State of Florida, on the 17th day of March, 1999.

                                    SOUTH FLORIDA BANK HOLDING CORPORATION

                                    By:  /s/ William P. Valenti
                                         ----------------------------------
                                         William P. Valenti, President and
                                         Chief Executive Officer

      Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities indicated on March 17th, 1999.
<TABLE>
<CAPTION>
      Signature                       Title
      ---------                       -----
<S>                                   <C>

 /s/ Robert Ernest Hendry             Chairman of the Board
-----------------------------
Robert Ernest Hendry


 /s/ William P. Valenti               President and Chief Executive Officer and 
-----------------------------         Director (Principal financial officer)
William P. Valenti                    


 /s/ Robert C. Adkins                 Director
-----------------------------
Robert C. Adkins


 /s/ Ronald D. Focht                  Director
-----------------------------
Ronald D.Focht


 /s/ Carole A. Green                  Director
-----------------------------
Carole A. Green


 /s/ James T. Humphrey, Jr.           Director
-----------------------------
James T. Humphrey, Jr.


 /s/ George T. Mann, Jr.              Director
-----------------------------
George T. Mann, Jr.


 /s/ Wallace M. Tinsley               Director
-----------------------------
Wallace M. Tinsley


 /s/ Jim Booth                        Vice President and Controller
-----------------------------         (Principal accounting officer)
Jim Booth
</TABLE>                              



                                       26

<PAGE>   30


                     South Florida Bank Holding Corporation
                                   Form 10-KSB
                    For Fiscal Year Ending December 31, 1998

                                  EXHIBIT INDEX

<TABLE>
<CAPTION>
Exhibit                                                             Page
  No.                             Exhibit                           No. 
-------          -------------------------------------------        ----

<S>              <C>                                                <C>    
10.1             Employment Agreement dated June 9, 1998
                 between South Florida Bank Holding
                 Corporation and William P. Valenti.

10.2             Employment Agreement dated July 1, 1998
                 between South Florida Bank Holding
                 Corporation and Harold S. Taylor, Jr.

13.1             South Florida Bank Holding Corporation 1998
                 Annual Report

21.1             Subsidiaries of the Registrant

27               Financial Data Schedule (for SEC use only)
</TABLE>







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